What is the effect of dispersed levels of cognitive ability of members of a (business) team on their team's performance? This paper reports the results of a field experiment in which 573 students in 49 teams start up and manage real companies under identical circumstances. We ensured exogenous variation in - otherwise random - team composition by assigning students to teams based on their measured cognitive abilities (Raven test). Each team performs a variety of tasks, often involving complex decision making. The key result of the experiment is that the performance of business teams first increases and then decreases with ability dispersion. We seek to understand this finding by developing a model in which team members of different ability levels form sub-teams with other team members with similar ability levels to specialize in different productive tasks. Diversity spreads production over different tasks in order to escape diminishing marginal returns under specialization. The model comes with a boundary condition: our experimental finding is most likely to emerge in settings where different tasks exhibit moderate differences in their productive contributions to total output.

We use a natural experiment in Denmark to test the hypothesis that aspiring
entrepreneurs face financial constraints because of low entrepreneurial quality. We
identify 304 constrained entrepreneurs who start a business after receiving windfall wealth and
examine the performance of these marginal entrepreneurs. We find that constrained
entrepreneurs have significantly lower survival rates and lower profits when compared
with a matched sample of unconstrained entrepreneurs. These results are consistent with
the hypothesis that the marginal entrepreneur is of low quality.

We use a large, rich Canadian micro-level dataset to examine the channels through which family
socio-economic status and unobservable characteristics a ect children's decisions to drop out of high
school. First, we document the strength of observable socio-economic factors: our data suggest that
teenage boys with two parents who are themselves high school dropouts have a 16% chance of
dropping out, compared to a dropout rate of less than 1% for boys whose parents both have a
university degree. We examine the channels through which this socio-economic gradient arises
using an extended version of the factor model set out in Carneiro, Hansen, and Heckman (2003).
Speci cally, we consider the impact of cognitive and non-cognitive ability and the value that parents
place on education. Our results support three main conclusions. First, cognitive ability at age 15
has a substantial impact on dropping out. Second, parental valuation of education has an impact
of approximately the same size as cognitive ability e ects for medium and low ability teenagers. A
low ability teenager has a probability of dropping out of approximately .03 if his parents place a
high value on education but .36 if their education valuation is low. Third, parental education has
no direct e ect on dropping out once we control for ability and parental valuation of education.
Our results point to the importance of whatever determines ability at age 15 (including, potentially,
early childhood interventions) and of parental valuation of education during the teenage years. We
also make a small methodological contribution by extending the standard factor based estimator
to allow a non-linear relationship between the factors and a covariate of interest. We show that
allowing for non-linearities has a substantial impact on estimated e ects.

The purpose of this Perspective Paper is to advance understanding of absorptive capacity, its underlying
dimensions, its multi-level antecedents, its impact on firm performance and the contextual factors that
affect absorptive capacity. Nineteen years after the Cohen and Levinthal 1990 paper, the field is
characterized by a wide array of theoretical perspectives and a wealth of empirical evidence. In this
paper, we first review these underlying theories and empirical studies of absorptive capacity. Given the
size and diversity of the absorptive capacity literature, we subsequently map the existing terrain of
research through a bibliometric analysis. The resulting bibliometric cartography shows the major
discrepancies in the organization field, namely that (1) most attention so far has been focused on the
tangible outcomes of absorptive capacity; (2) organizational design and individual level antecedents
have been relatively neglected in the absorptive capacity literature; and (3) the emergence of absorptive
capacity from the actions and interactions of individual, organizational and inter-organizational
antecedents remains unclear. Building on the bibliometric analysis, we develop an integrative model
that identifies the multi-level antecedents, process dimensions, and outcomes of absorptive capacity as
well as the contextual factors that affect absorptive capacity. We argue that realizing the potential of the
absorptive capacity concept requires more research that shows how “micro antecedents” and “macroantecedents”
influence future outcomes such as competitive advantage, innovation, and firm
performance. In particular, we identify conceptual gaps that may guide future research to fully exploit
the absorptive capacity concept in the organization field and to explore future fruitful extensions of the
concept.

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The recent years of rapid development of mobile technologies creates
opportunities for new user-groups in the mobile workforce to take advantage of information
systems (IS). However, to apprehend and harness these opportunities
for mobile IS it is crucial to fully understand the user group and the mobile technology.
In this paper we deductively, from previous research on aspects on mobility,
synthesize a tentative analytical framework capturing factors accentuated in
mobile IS design. We evaluate the framework based on criteria of completeness,
distinctiveness, and simplicity. Eventually, these two steps develop the framework
towards a theoretical contribution as theory for describing handheld computing
from a designer’s perspective. Thirteen semi-structured interviews were made and
the tentative framework was elaborated and confirmed.

The emergence of the Internet in the late 20th century and its continued prominence after the year
2000 have created challenges and opportunities for firms and scholars alike. For firms, information
technologies (IT) have facilitated access to foreign markets but exposed them to new forms of
competition, both commercial and non-commercial, which have undermined their successes. For
scholars, the new contexts created by IT have enabled new forms of behaviour not well explained
by existing theory. Confronted by these developments, firms attempted to maintain their business
models, while scholars applied established theories to explain and predict decisions and behaviour
in the new digital landscape. The emergence of widespread digital film and music piracy facilitated
by the Internet provides an example of how existing models are often insufficient to explain
behaviours enabled by new technologies. Scholars seeking to explain and predict digital piracy have
drawn on theories from across the social sciences to inform their investigations into the
phenomenon. While these investigations have revealed important insights into the antecedents of
digital piracy, the research literature is limited in three key ways. It is theoretically fragmented. It
has largely decontextualised digital piracy by not examining how it occurs in relation to legal
access. It has underemphasised factors that vary from title-to-title. This project integrates the key
streams of piracy research, namely the research informed by social psychology, criminology,
business ethics, marketing and economics, and presents a model that addresses the key limitations
in the literature. The model was examined over three successive empirical investigations conducted
between the autumn of 2010 and the spring of 2012, drawing on samples of university students and
consumers in Denmark. The findings from the investigations emphasise the value of an integrated
model that contextualises piracy and includes product-title factors. The model explains more
variance in access decisions than the models previously offered in the literature. The empirical
findings of the research conducted for the project indicate the importance of product-title factors,
namely price perceptions, legal availability, and desirability, in addition to access-mode factors
such as subjective norms, ethical judgements, and quality risks. The research contributes to the
literature on digital piracy in information systems (IS) by emphasising the importance of producttitle
factors in individuals' access decisions. Furthermore, it demonstrates the value of using an
integrated theoretical model in IS research, when a variety of potential explanations are offered for
behaviour.

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In the paper, we use the theory of mechanism design to exhibit the cost of efficient provision of healthcare, defined as the uniquely defined sum of individual side payments which would eliminate moral hazard. It is argued that this cost may be used to assess the costs arising from use of the treatment in cases where it is not appropriate from a strictly medical point of view. An example is given to indicate how this assessment might enter into practical cost-effectiveness analysis.

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Rhizomatic stories of representational faithfulness, decision making and control

Lennon, Niels Joseph Jerne(Fredriksberg, 2013)

[More information]

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Abstract:

There is a tendency in accounting theory, both external reporting and management
accounting, to express a representational ideal. This to be understood
in the sense that accounting information, independent on whether it is reported
externally or used for control purposes internally, ought to represent something
underlying, whether this is revenue, costs, performance or other things inscribed
in the accounting information. In some cases the underlying is not an object, but
a procedure which is developed with the purpose of standardising the calculations
as to become comparable (Financial Accounting Standards Board, 1980a).
In the beginning of the 1970’s in the accounting information literature, simultaneously
with the foundation of the American Financial Accounting Standards
Board (FASB), an academic discussion regarding which qualitative characteristics
accounting information ought to have, emerges (e.g. Ijiri, 1975, Hines, 1988
og Ingram and Rayburn, 1989). This was caused by FASB’s work on a conceptual
framework Standard of Financial Accounting Concepts (SFAC), which was
meant as a guide to the standard setters in the development of new accounting
standards/principles. A new notion, representational faithfulness, was introduced
in SFAC no. 2. The discussion about representational faithfulness is equivocal
and no unambiguous definition of what representational faithfulness actually is.
This has occasioned a range of dialogues about the representativity of accounting
information, the accounting setters’ roles and effects of disclosure of accounting
information...

This paper estimates the impact of accounting transparency on the term structure of CDS spreads for a large cross-section of rms. Using a newly developed measure of accounting transparency in Berger, Chen & Li (2006), we nd a downward-sloping term structure of transparency spreads. Estimating the gap between the high and low transparency credit curves at the 1, 3, 5, 7 and 10-year maturity, the transparency spread is insigni cant in the long end but highly signi cant and robust at 20 bps at the 1-year maturity. Furthermore, the eect of accounting transparency on the term structure of CDS spreads is largest for the most risky rms. These results are strongly supportive of the model by Du¢ e & Lando (2001), and add an explanation to the underprediction of short-term credit spreads by traditional structural credit risk models.

The thesis Adapting in the Knowledge Economy investigates the strategies
deployed by academic scientists when trying to adapt and maneuver within an
increasingly complex mixture of scientific, industrial and governmental agendas.
Chapter one “From insights to invoice” summarizes the last decade of Danish research
policy as a tendency towards intensified focus on interaction between the university and
“outside” actors. Looking at Danish policy documents and interview data the chapter
shows how policy changes responded to an idea of “ivory tower” researchers isolating
themselves in Danish universities. Furthermore, the interaction agenda was motivated
by the perception that knowledge was produced but not sufficiently used. Strongly
influenced by the concept of the knowledge economy and that of mode 2 knowledge
production, policy changes were directed at bridging a gap between the producers and
the consumers of knowledge. A series of reforms and initiatives were launched to
facilitate more interaction between science and industry as well as more responsiveness
towards societies’ problems on behalf of the universities. This interaction agenda was
coupled with an increase in the economic investment in research and an increased focus
on competition between researchers in order to ensure high quality in knowledge
production....

We consider additive intensity (Aalen) models as an alternative to the multiplicative intensity (Cox) models
for analyzing the default risk of a sample of rated, non- nancial U.S. rms. The setting allows for estimating
and testing the signi cance of time-varying e ects. We use a variety of model checking techniques to identify
misspeci cations. In our nal model we nd evidence of time-variation in the e ects of distance-to-default and
short-to-long term debt, we identify interactions between distance-to-default and other covariates, and the quick
ratio covariate is signi cant. None of our macroeconomic covariates are signi cant.

Business
schools
all
over
the
world
claim
educating
leaders
as
a
primary
objective.
Consider
these
from
the
“mission
statements”
of
prominent
players:
• “We
educate
leaders
who
make
a
difference
in
the
world”
(Harvard
Business
School),
• “…to
develop
innovative,
principled,
and
insightful
leaders”
(Stanford
Graduate
School
of
Business),
• “Through
teaching,
we
develop
responsible,
thoughtful
leaders”
(INSEAD)
At
the
same
time,
however,
there
have
been
many
claims
that
business
schools
have
not
delivered
on
these
commitments.
Just
two
weeks
ago,
Robert
Reich,
a
former
US
Treasury
Secretary,
criticized
Harvard
Business
School
for
“inculcating
in
[its
graduates]
a
set
of
ideas
and
principles
that
have
resulted
in
a
pay
gap
between
CEOs
and
ordinary
workers
that’s
gone
from
20-­‐to-­‐1
fifty
years
ago
to
almost
300-­‐to-­‐1
today,”
implying
that
social
ills
have
been
a
direct
result
of
the
content
and
nature
of
the
school’s
leadership
training.1
David
Brookes,
writing
in
the
New
York
Times
on
September
22
suggests
we
are
experiencing
a
“leadership
crisis”
in
today’s
world.2
There
is
a
pressing
need
for
leadership
pedagogy
to
(continue
to)
evolve,
especially
in
business
schools.
Progress
needs
to
be
made
in
terms
of
content,
but
also,
in
this
time
of
MOOCs
and
advancing
educational
technologies
on
every
front,
in
terms
of
modes
of
delivery.

The primary contents of women’s fashion magazines are fashion, beauty and
health. This paper sets out to explore the ways in which international fashion
magazines such as Elle, Vogue and Marie Claire portray feminine beauty in
textual and advertising matter and how their readers react to such portrayals.
Beauty is analysed as grooming practice, and make-up as the prime symbol of
the self and its many facets in social interaction. The paper looks at the different
kinds of ‘face’ that magazines invite their women readers to put on and
suggests that they – and their advertisers – adopt a ‘technology of enchantment’
as a means of exercise control over them. Magazine and advertising language is
imbued with ‘magical’ power, and the paper shows how the structure of
advertisements closely parallels that of magical spells used in certain healing
rituals. It concludes by using magazine reader interviews to learn the extent to
which women do or do not believe in such ‘spells’ and whether they are
encouraged to buy into the ‘beauty myth’.

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The goals of this thesis are to examine new technology-based firms’ use of aesthetic design as an element of service innovation and to explore potential relationships between aesthetic design and performance in this same context. There is a scarcity of research on aesthetic design as an element of service innovation, particularly in new technology-based firms. Because of this scarcity, a hybrid research strategy is appropriate and the empirical basis for this research encompasses multiple case studies, longitudinal quantitative data and evaluations
by expert panels. The first phase of the research involves developing an
operationalization of design that enables evaluation of aesthetic design as an element of innovation in technology-based firms. The second phase uses case research to explore the role and organization of aesthetic design in service innovation in new technology-based firms. The final phase explores relationships between aesthetic design and performance in the research context. Hypotheses are developed based on existing research, on one hand, and the results of the case research, on the other, and these hypotheses are tested using longitudinal survey-based data. The operationalization of design developed is a three-dimensional model consisting of functional design, visceral design and experiential design. Functional design is concerned with utility, features and delivery; visceral design is concerned with appealing to the human senses; and experiential design is concerned with message, symbols, culture, meaning, and emotional and sociological aspects. Visceral design and experiential design are combined to yield a formative measure of aesthetic design. The findings of the research are that new technology-based firms emphasize functional design over aesthetic design. Emphasis on aesthetic design is related positively with the importance of design in a firms’ sector and founders’ experience of sales and marketing, while it is negatively related with founders’
technical education. In new technology-based firms, aesthetic design can be characterized as being used to exploit or counteract the characteristics that distinguish services from products, namely intangibility, inseparability, heterogeneity and perishability. The application of aesthetic design to counteract these characteristics is more prevalent than exploitation. Aesthetic design in new technology-based firms is found to be primarily silent, meaning that those performing design activities are mostly managers and technical staff engaged in design activities as part of their development efforts
and without these activities necessarily being acknowledged as design.
The findings regarding the relationship between aesthetic design and
performance are that aesthetic design is positively related with competitive advantage, but that this relationship is dependent upon moderating factors. The effectiveness of aesthetic design in achieving competitive advantage through differentiation is found to differ depending on the current stage of commoditization. The greater the level of commoditization of a service the more effectively aesthetic design can be employed to improve competitive advantage. Furthermore, the findings suggest that the objectives underlying managers’
decisions to use aesthetic design in service innovation are attracting new customers, improving firm image and/or retaining existing customers, and doing so at lower cost. Hypothesis testing using longitudinal survey-based data confirms that by and large these benefits are realized by new technology-based firms.
This research makes a number of important contributions. The research focus lies in an area where there is little existing research and, thus, the operationalization of aesthetic design developed and the characterization of aesthetic design as an element of service innovation in new technology-based firms constitute important contributions. The characterization provides a picture of the prevalence, roles, organization and actors of aesthetic design in the research context.
The research also contributes insight about the relationship between aesthetic design as an element of service innovation and performance of new technologybased firms. The research shows that various positive relationships exist but that they can be contingent upon existing conditions, which act as moderating factors.